Brands are jumping on the Web3 bandwagon, embracing the decentralized web and all it has to offer. From rebranding and exploring new potential customers to engaging with Web3 audiences and younger generations to experimenting with new technology and exploring new sources of revenue, there’s a lot to gain from the transition. Plus, with the ability to distribute digital products and collectibles, increase brand awareness, and even create a unique loyalty or membership program, it’s no wonder companies are making a move.
We have seen successful cases from brands that have all seen success in the Web3 space, like Nike, Adidas, Starbucks, Gucci, Tiffany & Co.with Nike leading the pack in terms of profits after just one year. It’s clear they have an excellent strategy and execution, and they certainly know how to tap into the Web3 culture and community.
Porsche made some noise in the otherwise quiet NFT market with their drop, so let’s see how it fares!
Porsche 911
German carmaker Porsche released its first NFT collection on the 23rd of January, a 7,500-edition collection, which pays homage to the brand’s iconic 911 sports car, opened minting for allowlist holders at 9 am ET on Monday in four waves of one hour each. The NFT has the image of a white 911 sports car, the same for all editions, so don’t expect any rarity or difference like you’d find in typical collections. Collectors were allowed to mint up to three virtual 911 Porsche at 0.911 ETH each, roughly $1,490 according to ETH price at the time of writing. The subsequent phases of the minting process allow holders to choose one of the three “paths” to follow and customize the design and rarity of their NFTs.
Porsche has a Discord for the collection, but don’t expect to be chatting away — only officials are allowed to post messages, so you’re just there for info. Web3 communities argued that Porsche had no clue about the Web3 culture, since they’re more focused on making a quick buck than fostering a real community.
Porsche Halts Web3 Project Amidst Backlash
In the hours after the mint initially opened, sales were far from what was expected, where only 1,198 NFTs, about 16% of the total collection, had been sold on Monday evening. Sales in the secondary market could have improved too, where the collection’s floor price was set as 0.89ETH, lower than the minting price.
Porsche soon announced it would cut the supply, and clarified that minting would still be available until 11 am UTC on January 25. The collection then recorded a surge of FOMO buying and minting, which drove up the secondary market floor price and some mints. The collection finally ended with 2,363 editions at the end, meaning that only around 32% of the supply was minted. Additionally, the collection has 0% creator earnings, which means that the secondary market trading would not generate revenue for the collection.
The floor price of the collection now sits at 2.8ETH at the time of writing, a 200% increase from the mint price. The trading volume is 1,791 ETH at the time of writing.
Porsche Unveils Web3 Roadmap After Halt
Before and during the mint, only a few details about the utility and roadmap were told and shared with fans and potential buyers. Porsche only mentioned customization on your 911 sports car in the next phase, and the NFT will work as access to private events and experiences, which sounds like a typical NFT collection. It would be good enough if it were launched in 2021, but not now in 2023, fans weren’t impressed, and thus it was labeled as “overpriced” and “low effort.”
Here is the utility of the NFT announced by Porsche on Twitter after the mint:
- Behind-the-scenes access to the world of Porsche, starting from Feb 2023, and the ability to converse with Porsche insiders, like designers, engineers, racing drivers, etc.
- Co-Creation of Porsche’s future in Web3, by utilizing virtual co-create workshops with the Porsche Core team and deploying Discord polls for community decision-making.
- An exclusive capsule collection with physical items.
- Customization of the Porsche 911 NFT.
- A community vote on the best design and Porsche creating that car in real life.
- Attend Porsche’s experiences, and access exclusive events. (take note: not all NFT holders have this privilege.)
- Tracking experiences in different cities around the globe or a special trip to the home of Porsche.
- One private airdrop designed by partner artists.
To sum up, there is no surprise for the utility announced by Porsche, as future airdrop, access to exclusive events and experience, and discord polling are standard for past NFT collections. Even voting for creating a 911 sports car in real life is reasonably expected when the collection owner is a famous sports car brand.
This is more like a membership using NFT as the technology, with no surprises or new mechanisms introduced by NFT. The question would also leave the market to decide how the above experience affects the worth of its NFTs in terms of the mint and floor price of the collection.
Comments and opinions from the community
The crypto community had some harsh words for the mint, calling it “low effort” and “overpriced”.
“Low effort” in several areas: first, it would be the NFT’s visual design, where the 7500 edition share the same image and no rarity or properties were given, making the NFT common to all buyers and holders. Second, there is no Discord engagement before and during the mint. Discord joiners were not allowed to chat in the room, which the channel purely turned into a place for official announcement distribution. Third, no community was built for the project, and building one is very common for projects to show the affirmation and effort of the brand to enter the space.
“Overpriced” is apparently as literal as it’s said. 0.911 ETH is very pricy in today’s NFT launch, especially after the market dip and bear sentiments. The price is considered expensive during the 2021 NFT summer, not to mention a free mint summer in 2022. Essentially, without much knowledge of the project and its usefulness, 0.911 ETH was gambled on Porsche’s name alone. The value of the NFT will now depend on how potential buyers and holders value the promising exclusive experience and long-term engagement in the future.
The “low effort” and “overpriced” tags give this collection a bad rep.. The brand is seen to have started its Web3 journey by extracting millions of dollars from the community with low effort and delivery, having impossibly high expectations, and cutting out 99% of the market participants.
The brand’s perspective
Some say that Porsche needs a new Web3 advisory, as their plan and execution are much different from the market norm and expectations, especially since there is much to reference and learn from.
At the end of the mint, after the cut-off and announcement of utility, the floor price surged to 2.8ETH at the time of writing, a 200% growth from the mint price — a clear demonstration of the brand’s faith in their image and reliability, despite the limited information given.
Or maybe, as a luxury sports car brand, Porsche is not looking at the approach of engaging with the broader community, to include as many participants as possible, but to select their real and loyal members, with the high mint price and the trust to vacuous roadmap and utility.
The story continues, and only the upcoming utilities, events, and airdrop could prove whether the brand needs a different strategy towards Web3 or has deep beliefs in understanding what they are doing.
Considerations for brands entering Web3
As we stated right off the bat, the primary goal of launching the NFT collection is to engage with communities, discover new business models, and generate new sources of income — and that’s the bottom line. The target audiences would also be a primary concern for designing the implementing strategies. Ultimately, brands would like and look for loyal holders and customers that share common values.
Like in the case of Porsche, many complained that the launch cut out 99% of the communities. But that might also be how Porsche aimed the launched from the start, only to keep the loyal ones, those who would pay $1,400 out of trust and loyalty, despite being in the dark regarding its utilities. Those complaining might be some that are not so into the brand, or purely speculators that lose the chance to profit from trading.
We saw Nike, Adidas, Starbucks, and McDonald’s design their campaigns and collections targeting mass audiences and customers, matching their brand image and sales direction. For Porsche, with its luxury brand status, it’s no surprise that they’ve alienated most people.
The launch of Porsche’s collection could have gone better, as few surprises and inventions on mechanisms were introduced, leaving questions on the quality of the Web3 project. We will keep tracking the upcoming utilities to see how it goes.
Final Thoughts
Brands’ engagement with Web3 is always exciting and highly anticipated. The NFT and Web3 space has seen its fair share of successes and failures, so the community expects more from these established brands with their wealth of experience and resources, considering their success in the Web2 world.
We’re convinced that Web3 technology will take all our experiences to the next level — and this article will help you make sense of Porsche’s NFT launch. Keep your eyes peeled for more news and insights from the world of NFTs!
